Event:
In the 2022 government work report, the relevant contents on the information and communication industry include: promoting the development of digital economy and strengthening the overall layout of Digital China Construction; Build digital information infrastructure and promote 5g large-scale application; Promote the digital transformation of industries and develop smart cities and digital villages; Accelerate the development of industrial Internet, cultivate and expand digital industries such as integrated circuits and artificial intelligence; Improve the governance of digital economy and release the potential of data elements; Launch rural construction actions and strengthen infrastructure construction such as water, electricity, gas, letter and mail; Strengthen network security, data security and personal information protection.
Comments:
The report on “5g application scale and 5g application” focuses on the “5g application scale” and the “5g application scale” in the 21st year, focusing on the construction of 5g infrastructure and information technology “, From “increasing network construction” to “promoting large-scale application”. According to the data of the Ministry of industry and information technology, by the end of 2021, China had built and opened 1.425 million 5g base stations, an increase of about 710000 compared with the end of 2020. It is estimated that more than Shanghai Pudong Development Bank Co.Ltd(600000) new stations will be built in 2022, and the construction flexibility of the wireless side has been relatively weakened. In the communication industry report, we continue to emphasize that the long-term investment opportunities of 5g sector have changed from 5g construction to 5g application, and there are opportunities for relevant operators, Internet of things, private network, RCS, etc.
Emphasizing the digital economy, the theme market of counting East and counting West is expected to continue: the 22-year report focuses on the relevant contents of the digital economy, Including “promoting the development of digital economy, strengthening the overall layout of Digital China Construction; building digital information infrastructure, promoting industrial digital transformation, developing smart cities and digital villages, and improving digital economic governance”, as well as “digitizing traditional industries, digital government, digital trade and public culture”. As an important support for the digital economy, information infrastructure is expected to continue to receive attention. We believe that East digital West computing, as the main theme of the communication industry, is expected to continue.
Without emphasizing “raising speed and reducing fees”, operators are expected to usher in dividends of the times: raising speed and reducing fees in the information and communication industry has also been the focus of the government’s work report for many years. In 2018, the report proposed to “increase network speed and reduce fees, cancel traffic ‘roaming’ fees, and reduce mobile network traffic charges by at least 30% within the year.” In 2019, it was proposed to “carry out urban Gigabit broadband home entry demonstration, reduce the average broadband charge of small and medium-sized enterprises by 15% and the average mobile network traffic charge by more than 20% In 2020 and 2021, it is proposed to “reduce the average tariff of broadband and dedicated lines by 15% respectively.” “The average tariff of broadband and dedicated lines for small and medium-sized enterprises will be reduced by another 10%.” At the same time, “strengthen the construction of 5g network and gigabit optical network.” In recent years, the rapid decline in network costs has continued to benefit hundreds of millions of people and contribute to social and economic development. In 2022, the report did not emphasize “increasing speed and reducing fees”. We believe that the bottom of the operator’s industry policy has been further revealed. In the future, with the large-scale application of 5g, the b-end revenue is expected to further increase, and the operator is expected to usher in the dividend of the times.
Further support the development of small and medium-sized enterprises and strive to cultivate “specialized and special new” enterprises: the report emphasizes that we should strive to cultivate “specialized and special new” enterprises and give strong support in terms of capital, talents and incubation platform. In addition, the support for small and medium-sized enterprises includes “expanding the coverage of government financing guarantee for small and micro enterprises, striving to create a good financing ecology, further promoting the solution of the financing problems of the real economy, especially small and micro enterprises”, “increasing the clearing power of accounts owed to small and medium-sized enterprises” “Continue to implement the unemployment insurance steady post return policy, significantly improve the return proportion of small, medium-sized and micro enterprises”, “strengthen the implementation of the policy of adding and deducting R & D expenses, and increase the adding and deducting proportion of scientific and technological small and medium-sized enterprises from 75% to 100%”, “expand the coverage of export credit insurance for small, medium-sized and micro foreign trade enterprises”. Enterprises related to the “specialized new little giant” in the communication sector include Beijing Jiaxun Feihong Electrical Co.Ltd(300213) , Fibocom Wireless Inc(300638) , Hanwei Electronics Group Corporation(300007) , Suzhou Tfc Optical Communication Co.Ltd(300394) , Jushri Technologies Inc(300762) , Allwin Telecommunication Co.Ltd(002231) , etc.
Investment suggestion: we believe that information infrastructure, as an important support for the digital economy, is expected to continue to receive attention. We continue to be optimistic about the market of the communication sector, including:
1. It is expected that the thematic opportunities of East digital West computing will continue, focusing on Yangtze Optical Fibre And Cable Joint Stock Limited Company(601869) , etc. of optical fiber and optical cable, and Shanghai Athub Co.Ltd(603881) , Guangdong Aofei Data Technology Co.Ltd(300738) , Beijing Sinnet Technology Co.Ltd(300383) , Kehua Data Co.Ltd(002335) , Nanjing Canatal Data-Centre Environmental Tech Co.Ltd(603912) , Mcc Meili Cloud Computing Industry Investment Co.Ltd(000815) , etc. of IDC Engineering / refrigeration / operation and maintenance;
2. 5g applications continue to be promoted. Operators have value and are expected to benefit for a long time. Pay attention to three operators: China Mobile, China Telecom Corporation Limited(601728) , China United Network Communications Limited(600050) .
Risk tip: 5g commercial progress is less than expected, the price reduction of the industrial chain is more than expected, and the trade friction between China and the United States is escalating.
